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Gold/Mining/Energy : Copper - analysis -- Ignore unavailable to you. Want to Upgrade?

To: Stephen O who wrote (337)	7/23/2001 3:18:36 PM
From: Stephen O	Read Replies (1) \| Respond to of 2131

Copper at 2-Yr Low as Weaker German Economy Seen Slowing Demand New York, July 23 (Bloomberg) -- Copper fell to a two-year low after a report of declining business confidence in Germany, the third-largest user of the metal, led to concern about worsening demand from builders and manufacturers. German business confidence fell in June to the lowest level in five years, the report showed. Inventories of copper monitored by the London Metal Exchange are up 50 percent since June 1, and prices are down 21 percent from a year ago as economic growth slowed. ``There's no sign that demand is getting any better,'' said Jim Steel, an analyst at Refco Inc. in New York. ``The market just doesn't have a bottom.'' Copper for September delivery fell as much as 1.6 cents, or 2.3 percent, to 68.4 cents a pound on the Comex division of the New York Mercantile Exchange, the biggest decline in six weeks and the lowest price for a most active contract since June 25, 1999. The main index of German business confidence published by the Ifo research institute fell to 89.5 in June from 90.8 in May. The index was at its lowest level since August 1996. The survey of 7,000 executives suggests that companies will pare production and hiring, analysts said. Germany is the third- biggest consumer of copper, after the U.S. and China. Demand Fell U.S. copper demand fell 15 percent in the second quarter alone, according to William O'Neill, head of futures research at Merrill Lynch & Co. in New York. The drop in the U.S., the biggest consumer of copper, has contributed to the 18 percent drop in prices this year. Chile, the biggest producer, reduced copper exports in June because of the lower prices. The value of copper sales fell to $546.8 million, the lowest level since June 2000, from $606.4 million in May, according to the Chilean Central Bank. Global mine supply is still expected to exceed demand by 182,000 tons this year, said Tony Warwick-Ching, a copper consultant at CRU International in London. Copper buyers drained inventories last year, as demand exceeded production by 487,000 tons, according to CRU, a private research firm. Inventories in warehouses monitored by the London Metal Exchange climbed 400 metric tons, the 23rd straight increase, to 649,750 tons, the highest since May 2000, the exchange said in its daily warehouse report. In London, copper for delivery in three months fell as much as $25, or 1.6 percent, to $1,519 a metric ton (68.90 cents a pound) on the London Metal Exchange, also the lowest since June 25, 1999. Other metals traded in London also fell. Tin for delivery in three months fell as much as $165, or 3.9 percent, to $4,105 a ton, the biggest one-day decline since August 1995. --Claudia Carpenter in the New York newsroom (212) 318-2346 or at ccarpenter2@bloomberg.net with reporting by Sonja Dieckhoefer in Frankfurt and Heather Walsh in Santiago